Little-known cruise fact could cost you thousands

You break your leg the week before your dream holiday and have to cancel flights, hotel bookings, everything.

You fall off the back of a motorbike in Thailand and need to spend three days in a Bangkok hospital …

Travel insurers have heard it all. And they seem to have listened. Not only are there now more travel insurance brands than ever, they cover more than they ever have and spell it out on websites (some have apps as well) and there are policies to suit just about everyone.

Still, it can be confusing. "The important thing to understand," says Maureen Mullins of Cover-More, "is that travel insurance is a contract between two parties: we undertake to look after you if something goes wrong and in return you agree to look after yourself and your belongings."

WHY SHOULD I GET TRAVEL INSURANCE?

For the same reason we get car insurance: just in case, aka peace of mind. Travel insurance is all about the "big three", says Phil Sylvester from Travel Insurance Direct: cover for medical expenses, cancellation and delay costs, and losing your stuff (by loss or theft).

And it's not expensive. "If you can afford to travel, you can afford travel insurance," Foreign Minister Julie Bishop likes to say and apparently we're getting the message: 91 per cent of Australians who travelled overseas last year had travel insurance, according to a recent survey by the Department of Foreign Affairs and Trade/Smartraveller.

Contrary to popular belief, the Australian Government won't come to your rescue if you get into a fix overseas. Some countries won't let you in without travel insurance (United Arab Emirates and Cuba). And some adventure tour operators (such as World Expeditions) require you to have travel insurance before you can book one of their trips.

WON'T MEDICARE COVER ME IF I'M CRUISING BETWEEN AUSTRALIAN PORTS?

Here's a little-known fact: a visit to the ship's doctor won't be covered by Medicare or your private health fund even if you're travelling between, say, Sydney and Brisbane and even if you're still in port. If you're too sick to sail, your best bet is to disembark and claim for cancellation costs.

WON'T MEDICARE COVER ME IF I'M TRAVELLING IN AUSTRALIA?

Medicare or private health insurance might cover you in the event of a medical emergency within Australia, but you'll need domestic travel insurance against other travel-related trouble (see "big three" above).

Your Medicare card does entitle you to basic medical treatment in 11 countries that Australia has reciprocal healthcare agreement with, including New Zealand and the UK. But if you need to be evacuated, or bust your knee skiing and have to fly business class back to Australia, only travel insurance can help.

DO I NEED TRAVEL INSURANCE WHEN I GO ON A CRUISE?

Cruising might seem safer than other kinds of travel, but cruise insurance (included in some travel insurance policies) is a must, for one big reason: if you're sick or injured at sea, you'll be covered for evacuation from the nearest port, which can be expensive even within Australia. A good cruise travel insurance policy will also cover your flights and accommodation before and after the cruise - which is important if a delay causes you to, er, miss the boat - and cancelled shore excursions, among other things.

WHEN SHOULD I BUY TRAVEL INSURANCE?

Easy: as soon as you pay for any part of your trip, whether it's a return flight to London or accommodation in Alice Springs, so you're covered if you have to cancel any arrangements.

HOW DO I CHOOSE THE BEST POLICY?

First, pick the type of policy you need: single, family, cruise, ski, seniors (if you're over 60) or annual multi-trip (better value if you go overseas more than twice a year). Some insurers also offer basic/budget and premium policies with differing levels of cover. Next, make sure you get the coverage you need by thinking about: where you're going, what you'll be doing, how valuable your belongings are (and if you need extra cover for them) and whether you need to declare any pre-existing medical conditions (common conditions such as asthma are usually covered). If in doubt, ask - a quick phone call or online chat is all it takes.

DO OUR KIDS NEED THEIR OWN TRAVEL INSURANCE?

If you're travelling with your children or grandchildren and they're under 18, they're usually covered by your policy, for free. If you're travelling with an unborn child, however, you're not covered for complications as a result of your pregnancy after 26 weeks (that date can vary from 18 to 32 weeks). Pregnancy is regarded as a pre-existing medical condition, which means you have to disclose it.

WHAT WON'T TRAVEL INSURANCE COVER?

Forget about being covered if you travel against medical advice or do something illegal, if alcohol was a contributing factor or if you ignore a "Do not travel" alert issued by the Australian Government on its Smartraveller.gov.au website. It's a good idea to keep an eye on travel warnings for your destination, in fact. If you bought travel insurance for a trip to Bali after Mt Agung started erupting late last year, for instance, you wouldn't have been covered for flights delayed by volcanic ash, but your insurance would still cover non-volcano-related incidents.

AM I COVERED AT AN AIRBNB OR IN A HOME EXCHANGE?

Generally, yes. Most travel insurance companies treat non-hotel accommodation like hotels as long as you can show receipts and evidence of your stay.

DO I HAVE TO PAY EXTRA IF I'M GOING SKIING OR SCUBA DIVING?

Yes (for skiing) and no (for diving). Headed to Japan to ski or snowboard? You'll have to either pay a higher premium or choose a "ski travel" or "snow sports" policy, which will often include cover for off-piste, snowcat and heli-skiing.

Most policies automatically cover scuba diving, on the other hand, along with a surprisingly long list of other adventure activities including: surfing, hiking, snorkelling, sailing, cycling, horse riding, whitewater rafting, even tandem skydiving, bungee jumping and shark cage diving. But they won't cover riskier pursuits such as rock climbing, running with the bulls in Spain and expeditions in remote places.

WHAT SHOULD I DO IF I MISS A FLIGHT?

First, talk to the airline; they might be able to put you on another flight, even with a partner airline, depending on various factors such as where you're going and why you missed the flight. Failing that, call your travel insurer; they might pay for accommodation, meals and transfers during your delay and help in other ways.

But beware: cancelled flights aren't an excuse to get an upgrade at your insurer's expense. You're not supposed to "gain" from a travel insurance claim, just break even.

AM I TOO OLD TO GET TRAVEL INSURANCE?

If you're upfront about pre-existing medical conditions, you can get travel insurance at any age, as long as your insurer covers "seniors" (most do). The catch is that once you hit 60, your premiums start to climb and even common pre-existing conditions might no longer be covered.

IF I PAY FOR TRAVEL ON MY CREDIT CARD, DOESN'T THAT INCLUDE INSURANCE?

It depends (the most used phrase in the travel insurance industry). The main problem with travel insurance offered by credit card companies, or airlines, is you might not know exactly what you're covered for until you make a claim. Also, most cards offer only international, not domestic, travel insurance.

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